Entire Section

  • 2007

    Update Number Effective Date

    (DD/MM/YY)
    Topics
    Update No. 24 09/07/2007 IPO Brokerage
    Update No. 23 21/05/2007 Electronic Disclosure Project and various other amendments
    25/06/2007 Electronic Disclosure Project (excluding Headline Categories)
    Others -- Proposed Headline Categories
    Update No. 22 01/01/2007 The regulation of sponsors and compliance advisers

    • Update No. 24

      Note to subscribers for the amendments to the rules governing the listing of securities on the Growth Enterprise Market (the "GEM Listing Rules")

      Update No. 24

      February 2008

      Dear Sirs,

      Various amendments to the GEM Listing Rules

      We enclose reprinted pages of the GEM Listing Rules. The reprinted pages incorporate:

      •  an amendment to implement an extension, to 2:00 p.m. , of the lunchtime publication window for announcements;
      •  an amendment to allow the publication of any type of announcements during the lunchtime publication window; and
      •  amendments to provide for the new arrangements for distribution of brokerage on initial public offerings (IPOs) through Autopay and to include expressly the brokerage payment arrangements for eIPO applications to reflect the current market practice.

      We also enclose the filing instructions.

      Publication of announcements

      On 10 March 2008 the current restrictions on the publication of announcements outside of trading hours will be relaxed.

      A GEM issuer is currently able to publish announcements, including an announcement containing price sensitive information, between 6:00 a.m. and 9:00 a.m. on a trading day, without suspension. This policy will continue. Also, a GEM issuer will continue to be able to publish any announcement after 4:15 p.m. on a trading day.

      Currently, only preliminary results announcements, overseas regulatory news, suspension announcements and "standard" and "super" announcements can be published via the GEM website during lunchtime. From 10 March 2008 GEM issuers will be allowed to publish any type of announcement during lunchtime including announcements containing information that may have a material effect on market activity in and the price of the issuer's listed securities.

      Currently the lunchtime window for the publication of announcements ends at 1:30 p.m.. From 10 March 2008 this window will be extended by half an hour to 2:00 p.m..

      IPO brokerage

      Under the new arrangements for distribution of brokerage on IPOs, brokerage paid by investors is passed on by the issuer directly through Autopay into the bank account of the relevant Exchange Participant. This represents an improvement on the previous practice of distributing brokerage by physical cheques and is conducive to the timely and orderly administration of the IPO process.

      The GEM Listing Rules provide for payment of the IPO brokerage to an Exchange Participant or to the Exchange depending on whether or not the successful application form bears the chop of an Exchange Participant. An eIPO does not involve physical application and therefore chopping is not possible. In practice, issuers through registrars still pay the brokerage to an Exchange Participant for an eIPO application which bears the broker number of the Exchange Participant and to the Exchange where the application does not bear a broker number.

      The amendments to paragraph 6 of appendix 9 to the GEM Listing Rules provide for the new arrangements for distribution of brokerage on IPOs through Autopay and expressly include the brokerage payment arrangements for eIPO applications to reflect the current market practice.

      Coming into effect

      The amendments in relation to the publication of announcements will become effective on 10 March 2008.

      The amendments in relation to IPO brokerage became effective on 9 July 2007.

      Please click HEREHERE to see the amendments relating to publication of announcements.

      Please click HEREHERE to see the amendments relating to IPO brokerage.

      Yours faithfully,

      For and on behalf of

      The Stock Exchange of Hong Kong Limited

      Richard Williams

      Head of Listing

    • Update No. 23

      • Electronic Disclosure Project and various other amendments

        Note to subscribers for the amendments to the rules governing the listing of securities on the Growth Enterprise Market (the "GEM Listing Rules")

        Update No. 23

        May 2007

        Dear Sirs,

        Various amendments to the GEM Listing Rules

        We enclose reprinted pages of the GEM Listing Rules. The reprinted pages incorporate:-

        •  amendments to implement the new regime for electronic submission of regulatory information for dissemination on the HKEx website or Growth Enterprise Market (GEM) website (the Electronic Disclosure Project); and
        •  various other, minor amendments to the GEM Listing Rules.

        We also enclose the filing instructions.

        Electronic Disclosure Project

        The effective date of the Electronic Disclosure Project is 25 June 2007. Key features of the Electronic Disclosure Project in so far as it relates to GEM issuers include:

        •  GEM issuers will be required to submit their disclosures to HKEx electronically through HKEx's e-Submission System. Announcements (with limited exceptions) must be submitted for publication outside trading hours.
        •  12 months after the effective date of the Electronic Disclosure Project, GEM issuers must have their own website.

        For further details of the Electronic Disclosure Project, please see HKEx's Exposure Conclusion on "Abolition of Requirement for Main Board Issuers to Publish Paid Announcements in Newspapers and Related Matters" published in July 2006 and Communication Paper "From Paper to Paperless" published in March 2007. These documents are viewable on the HKEx website at http://www.hkex.com.hk/eng/newsconsul/mktconsul/documents/npa.pdf and at http://www.hkex.com.hk/eng/listing/edp/edp_consul/documents/ess_cp.pdf respectively.

        Minor amendments

        The other amendments to the GEM Listing Rules are as follows:

        Reflecting current name of HKICPA

        Various minor amendments have been made to reflect the current name of HKICPA.

        Accounting related definitions and references

        Minor amendments have been made to update accounting definitions and references. Key amendments include:

        •  changing the definition of "affiliated company" in rule 1.01 to include associated and jointly controlled entities;
        •  changing the definition of "Hong Kong Financial Reporting Standards" or "HKFRS" in rule 1.01;
        •  in rule 5.15 changing the old reference to "Fellow or Associate Member" to "certified public accountant registered with the HKICPA"; and
        •  in rule 7.02 changing the old reference to "professional accountants" to "certified public accountants".

        Codifying and further liberalising the "no other relationship" exemption in FAQ 56

        A new note (2) has been added to rule 20.11(4)(c) to codify and further liberalise the "no other relationship" exemption as set out in No. 56 of the "Frequently Asked Questions on Rule Amendments relating to Corporate Governance and Listing Criteria Issues" such that a substantial shareholder of a non wholly-owned subsidiary should also be permitted to act as a director of that subsidiary without it being treated as a connected person.

        Reduction of SFC Transaction Levy

        The Securities & Futures (Reduction of Levy) Order 2006, which came into operation on 1 December 2006 , provides for a 20% reduction of the levy payable in respect of any trading in securities, futures or options contracts. Paragraph 3(2) of Appendix 9 to the GEM Listing Rules has been amended in a manner to reflect this change and to obviate the need to amend the rules in the future as a result of any further rate changes.

        Coming into effect

        The amendments in relation to the Electronic Disclosure Project will become effective on 25 June 2007.

        The minor amendments will become effective on 21 May 2007.

        Please click HEREHERE to see the amendments relating to the Electronic Disclosure Project (excluding Headline Categories).

        Please click HEREHERE to see the amendments relating to the minor amendments.

        Yours faithfully

        For and on behalf of

        The Stock Exchange of Hong Kong Limited

        Richard Williams

        Head of Listing

      • Electronic Disclosure Project (excluding Headline Categories)

        Note to subscribers for the amendments to the rules governing the listing of securities on the Growth Enterprise Market (the "GEM Listing Rules")

        Update No. 23

        May 2007

        Dear Sirs,

        Various amendments to the GEM Listing Rules

        We enclose reprinted pages of the GEM Listing Rules. The reprinted pages incorporate:-

        •  amendments to implement the new regime for electronic submission of regulatory information for dissemination on the HKEx website or Growth Enterprise Market (GEM) website (the Electronic Disclosure Project); and
        •  various other, minor amendments to the GEM Listing Rules.

        We also enclose the filing instructions.

        Electronic Disclosure Project

        The effective date of the Electronic Disclosure Project is 25 June 2007. Key features of the Electronic Disclosure Project in so far as it relates to GEM issuers include:

        •  GEM issuers will be required to submit their disclosures to HKEx electronically through HKEx's e-Submission System. Announcements (with limited exceptions) must be submitted for publication outside trading hours.
        •  12 months after the effective date of the Electronic Disclosure Project, GEM issuers must have their own website.

        For further details of the Electronic Disclosure Project, please see HKEx's Exposure Conclusion on "Abolition of Requirement for Main Board Issuers to Publish Paid Announcements in Newspapers and Related Matters" published in July 2006 and Communication Paper "From Paper to Paperless" published in March 2007. These documents are viewable on the HKEx website at http://www.hkex.com.hk/eng/newsconsul/mktconsul/documents/npa.pdf and at http://www.hkex.com.hk/eng/listing/edp/edp_consul/documents/ess_cp.pdf respectively.

        Minor amendments

        The other amendments to the GEM Listing Rules are as follows:

        Reflecting current name of HKICPA

        Various minor amendments have been made to reflect the current name of HKICPA.

        Accounting related definitions and references

        Minor amendments have been made to update accounting definitions and references. Key amendments include:

        •  changing the definition of "affiliated company" in rule 1.01 to include associated and jointly controlled entities;
        •  changing the definition of "Hong Kong Financial Reporting Standards" or "HKFRS" in rule 1.01;
        •  in rule 5.15 changing the old reference to "Fellow or Associate Member" to "certified public accountant registered with the HKICPA"; and
        •  in rule 7.02 changing the old reference to "professional accountants" to "certified public accountants".

        Codifying and further liberalising the "no other relationship" exemption in FAQ 56

        A new note (2) has been added to rule 20.11(4)(c) to codify and further liberalise the "no other relationship" exemption as set out in No. 56 of the "Frequently Asked Questions on Rule Amendments relating to Corporate Governance and Listing Criteria Issues" such that a substantial shareholder of a non wholly-owned subsidiary should also be permitted to act as a director of that subsidiary without it being treated as a connected person.

        Reduction of SFC Transaction Levy

        The Securities & Futures (Reduction of Levy) Order 2006, which came into operation on 1 December 2006 , provides for a 20% reduction of the levy payable in respect of any trading in securities, futures or options contracts. Paragraph 3(2) of Appendix 9 to the GEM Listing Rules has been amended in a manner to reflect this change and to obviate the need to amend the rules in the future as a result of any further rate changes.

        Coming into effect

        The amendments in relation to the Electronic Disclosure Project will become effective on 25 June 2007.

        The minor amendments will become effective on 21 May 2007.

        Please click HEREHERE to see the amendments relating to the Electronic Disclosure Project (excluding Headline Categories).

        Please click HEREHERE to see the amendments relating to the minor amendments.

        Yours faithfully

        For and on behalf of

        The Stock Exchange of Hong Kong Limited

        Richard Williams

        Head of Listing

    • Update No. 22

      Note to subscribers for the amendments to the rules governing the listing of securities on the Growth Enterprise Market (the "GEM Listing Rules")

      Update No. 22

      13 November 2006

      Dear Sirs,

      Various amendments to the GEM Listing Rules

      We enclose reprinted pages of the GEM Listing Rules. The reprinted pages incorporate:-

      •   amendments to the GEM Listing Rules relating to the regulation of Sponsors and Compliance Advisers; and
      •   amendments to the GEM Listing Rules regarding the number of deputy chairmen on the GEM Listing Committee.

      We also enclose the filing instructions.

      Amendments relating to the regulation of Sponsors and Compliance Advisers

      In October 2004 the Exchange and the SFC concluded a joint consultation regarding the regulation of Sponsors, Compliance Advisers and independent financial advisers. In the consultation conclusions report published on 19 October 2004 (the 2004 Conclusions) the Exchange and the SFC stated that, in the light of responses to the consultation, going forward, the SFC, as statutory regulator, would be responsible for assessment of eligibility, on-going supervision, discipline and enforcement of the conduct of corporate finance advisers who discharge the work of Sponsors and Compliance Advisers, whilst the Exchange, as market operator, should continue to be responsible for implementation and administration of the GEM Listing Rule requirements including the practice notes on due diligence.

      The 2004 Conclusions stated that the SFC would consult in relation to amendments to its licensing regime and that once that consultation was completed, in order to avoid regulatory duplication, the Exchange intended to remove the existing eligibility criteria from the GEM Listing Rules.

      The SFC has completed its second phase consultation. It published consultation conclusions in April 2006. Consequently, the Exchange now intends to amend the GEM Listing Rules as anticipated in the 2004 Conclusions.

      Key amendments

      The key GEM Listing Rule amendments are set out below.

      •   Currently, in order to undertake work as a Sponsor or Compliance Adviser, a firm must be approved by the Exchange and admitted to the list of Sponsors maintained by the Exchange. The GEM Listing Rules set out detailed eligibility criteria for admission to the Sponsor list. The Rules also provide that generally Sponsors' eligibility to remain on the list is reviewed by the Exchange annually.
      •   Consistent with removing regulatory overlap regarding the eligibility of Sponsors and Compliance Advisers, the GEM Listing Rules will be amended to provide that the Exchange will permit a firm to work as a Sponsor or Compliance Adviser provided the firm is appropriately licensed or registered by the SFC. Also, the whole of Chapter 6 of the GEM Listing Rules will be repealed although some Rules that were in Chapter 6 will be retained under Chapter 6A.
      •   Similarly, the Exchange will no longer have any role in relation to monitoring a firm's ongoing eligibility to undertake Sponsor work or Compliance Adviser work. Again, consistent with the 2004 Conclusions, that will be the sole responsibility of the SFC. Amongst other things, this means that the Exchange will no longer undertake annual reviews of Sponsor firms nor maintain a list of approved Sponsors.
      •   The GEM Listing Rules will be amended such that the SFC alone will be responsible for the discipline and sanctioning of Sponsors and Compliance Advisers. However, the Exchange will continue to co-operate with the SFC in relation to relevant issues regarding the performance of Sponsors and Compliance Advisers, as appropriate.

      Coming into effect

      These Rule amendments will become effective on 1 January 2007. Transitional arrangements are set out in new Rule 6A.38.

      Amendments regarding the number of deputy chairmen on the GEM Listing Committee

      The GEM Listing Rules have been amended to provide the flexibility for the Listing Nominating Committee to nominate and the Exchange Board to appoint more than one deputy chairman to the GEM Listing Committee. The appointment of more than one deputy chairman will allow a reduction in the workload of the Deputy Chairman to the GEM Listing Committee and also aid in succession planning for the role of GEM Listing Committee Chairman.

      Coming into effect

      These Rule amendments became effective on the date they were published, that is, 22 September 2006.

      Please click HEREHERE to see the amendments relating to the regulation of Sponsors and Compliance Advisers.

      Please click HEREHERE to see the amendments regarding the number of deputy chairmen on the Listing Committee.

      Yours faithfully

      For and on behalf of

      The Stock Exchange of Hong Kong Limited

      Richard Williams

      Head of Listing